Self-Settled Trusts


Self-Settled Trusts

“Howard Berk and Chardell Salvant have always made me feel like a person they care about and not just a number. I appreciate all of the service that they have provided me.”

Dietrich W.

IDPT Client

Self-settled trusts are created with the disabled person’s own funds. When the person with disabilities receives funds through a personal injury suit, medical malpractice suit, or inheritance, it may be appropriate to create a special needs trust (SNT) with these funds. Additionally, the person with disabilities or his/her representative may consider a SNT to preserve existing assets at the onset of disability. In guardianship cases, this would be in accordance with a guardian’s duty to engage in estate planning.

Individuals under the age of 65 can fund a self-settled special needs trust without a Medicaid-imposed transfer penalty. Persons with disabilities under the guardianship of the State Guardian or Public Guardian are exempted from the under 65 rule. Please contact our office to discuss planning for individuals over the age of 65.

Funds in a self-settled special needs trust are subject to Medicaid payback. In other words, upon the beneficiary’s death, the remaining funds in the trust will be used to reimburse the state for medical and financial benefits provided on the beneficiary’s behalf. After Medicaid payback is satisfied, the trust balance is distributed to the remainderman beneficiaries listed in the trust document.

Self-settled trusts can be stand-alone trusts or set up as a sub-account of the Illinois Disability Pooled Trust.

Advantages of Participating
in the Pooled Trust

The IDPT’s master pooled trust agreement has be pre-approved by the Social Security Administration

Reduced trustee fees

Access to institutional level “pooled” investment opportunities

Ease and efficiencies in ensuring compliance of trust documents

Significant savings due to the elimination of the need for a surety bond in a guardianship case